The High Court has stayed the initial public offering (IPO) of Khulna Printing and Packaging Limited (KPPL).
The bench of justices Mirza Hussain Haider and Muhammad Khurshid Alam Sarkar issued the order on Wednesday after initial hearing of a petition.
It also issued a rule as to why the IPO will not be cancelled. Media reports indicated the company’s effort to project inflated revenues and sales to attract strong public response.Supreme Court lawyer Md Raihanul Mostofa filed the petition. His counsel Qazi Arifur Rahman said that the company provided false information in its IPO prospectus to raise capital.
KPPL got the market regulator’s clearance to raise Tk 400 million by issuing 40 million shares on Mar 4 this year. Subscriptions for the IPO opened on Sunday and were supposed to end on May 8.
Its IPO prospectus says the firm’s revenue in 2009 -10 fiscal was Tk 340 million. But, the very next year it surged to Tk 1.19 billion, up by a staggering 247 percent.
Then, between July 2011 and June 2012, the company’s sales shot up to Tk 2.08 billion before dipping somewhat in July 2012- June 2013 to Tk 1.91 billion.
Industry insiders, however, found KPPL’s claim as outrageous. – bdnews24.com
